Q&A: Steve Coll on the WaPo purchase

The new dean of Columbia's Journalism School worked at the Washington Post for two decades

Steve Coll, the new dean of Columbia’s Journalism School, spent 20 years as a reporter and editor at The Washington Post, serving as the paper’s managing editor from 1998-2004. CJR spoke to him about the sale of the Post to Jeff Bezos, the founder of Amazon.

What are some of the bigger strategic mistakes the Post made in recent years?

Probably the biggest mistake, at the beginning, was to extrapolate the old model of market penetration—that is, controlling the local distribution system in an era of the Web’s birth. At first, the Post thought that the best way to respond to electronic news was to own the pipe and have a kind of proprietary approach to pushing content to Washingtonians. That was analogous to the role that that the newspaper had come to play after the last of its local competitors, the Evening Star, died. But it turned out that the Web was a much more open system than that, and so there was some time lost working on the old model.

Then I think, fairly early on for newspaper companies, to give the Post credit, they recognized this kind of open architecture had a whole different set of questions that had to be addressed. And the story of the last 15 years is that the Post knew it had a certain amount of time, not infinite time, to try to solve the problem of digital audiences and digital revenue. To Don [Graham]’s credit, he tried everything he could think of. He lashed up with Silicon Valley companies. He started a digital division and tried to keep it separate from the newspaper so the old guard wouldn’t smother it in its crib. He funded some innovation and experimentation when it wasn’t profitable. The one thing he wasn’t willing to do was to take the Post’s brand and go national, or go global, on digital platforms, or by buying a television network or that sort of thing.

I’m not an investment banker, but my own view a decade ago was that the value of the Post’s journalism, its place in Washington, its reputation from the Ben Bradlee era, might create an opportunity globally and nationally—not in print, but digitally and through video. And that was an argument that was had again and again. And the view of the board, and I think of Don, was that it was the regional franchise that created value. That’s where the value proposition had always come from. It was connected to local readers, local businesses, local advertising revenue, and that we had to stick close to that franchise and not attempt to extrapolate it.

And so, they tried. They tried everything they could think of to replace the lost sources of classified revenue, and I think there was a kind of wistfulness in the statements Monday, where you basically hear Don saying, “I think it would be better for someone else to take a try.”

What does Bezos bring to the problems that you’re describing that the Grahams couldn’t, or didn’t, address?

On the positive side he brings a very strong track record in the new data science of marketing and business. He was an early innovator in using Big Data and customer preferences to disrupt incumbent industries. And he’s a quant guy. He understands the power of not just algorithms, which is sort of a broad term—a placeholder for a lot of different kinds of computer science—but really data in all of its dynamic forms for business. He saw a kind of arbitrage opportunity in the book business and other kinds of retail, where he used data to break into industries. And so he brings that expertise, that management culture. Also, by the way, Amazon executes exceptionally well. That may be 90 percent of why they’ve been successful; maybe the data science is less important than we on the outside think. But he brings that track record, that management culture, those insights about consumer preferences and how to monetize them to a problem in local newspapering that is now befuddling every owner of local newspaper franchises in the country: How do you reach and hold audiences through digital channels when they have so many other media choices besides newspapers? And then, when you can hold them in significant numbers, as The Washington Post has—even though its circulation has diminished, its total eyeballs in the Washington area remains very powerful—how do you achieve enough revenue from that audience to pay for the costs of newsgathering as traditionally defined, and how do you keep a newsroom funded and committed to high-quality journalism while you’re trying to solve this equation? That’s the tricky part.

BuzzFeed and others have tried to figure out how you can learn from consumer preferences and how you can feed them the information that you think they want. But the data science as purely a marketing proposition, decoupled from journalism, doesn’t necessarily create a business model, and it certainly doesn’t necessarily create high-quality journalism. So figuring out how to do all of that at the same time, that’s the tricky part. And that may be a little bit beyond Bezos’s experience and Amazon’s record.

Assuming Bezos is inclined, is it too late to leverage the Post brand, its tradition of great journalism, into kind of a global entity you mentioned earlier?

That’s a great question, and I don’t know. I was walking around this morning and muttering, “It may be too late.” But it might not be. It depends on how powerful Bezos’s insights are into data science and marketing, because he could give The New York Times a little bit of a run in the digital universe if he chose to compete in some of the spaces they’re carving out for themselves with digital revenue.

But it would require a content strategy that would need investments, and I’m not sure that that’s what he has in mind. It would require a degree of commitment, after the shrinkage and after the decade of experimentation and not really getting around the corner. It might be hard to reverse direction that way. It might not even be advisable. I think that he has a lot of problems to solve just within the existing franchise that befuddled Don and a lot of other very smart people. So it might be that his intention is just to try to solve the equation as a matter of regional retail advertising, audience marketing, customer connections, and multiple revenue streams.

The Washington Post brand—the reputation of this paper for enterprising journalism, for a kind of public-minded mission, for global relevancy—that was born in the era of the 1970s. And the generation that came of age during that period—myself as a young journalist, but also lots of readers from the Boomer era—is still alive in the United States. And it still has a nostalgic memory of The Washington Post’s importance during the Nixon administration and otherwise. But it’s an aging generation. The real challenge is to make that brand relevant to the generation that’s coming out of college now, and that would be harder to do.

They’ve tried, certainly editorially, to invest in those kinds of voices. And they’ve had some success editorially. Ezra’s a very strong asset for them. But whether you could really build a total strategy out of that, while also solving the problems regionally of revenue generation and circulation, that might be a big ask.

Bezos has a reputation for managing Amazon for growth rather than profits, and as long as we’re speculating about his intentions, is that something that we should be encouraged by?

It could be relevant. As you say, we can only speculate about his intentions at this stage. I don’t know him and have never met him, and I don’t really know how to interpret the record that he presents as the new owner of The Washington Post. But I would divide it into aspects of his record that seem encouraging potentially and aspects of his record that raise questions.

On the encouraging side, the fact that he has managed Amazon with very long time horizons in mind, is I think very encouraging. He built that company, not for the next quarter, and not even for the next year, but for decades. And he’s still arguing to shareholders and analysts that they need to be patient while it continues down this very long horizon. So that’s a temperament, a strategic perspective, that he’ll need. Secondly, he has resources; how deep he wants to reach into his pockets to support this effort, who knows. But he certainly has resources and the chances to employ them. And the other thing that I’ve heard people mention that sounds right to me is that he’s a fierce competitor. The book industry, and lots of people I know, love to hate Amazon because it is fearsome and effective when it chooses to compete on price or market share. That comes from the top, that spirit of really wanting to own something when you go into it. And if he brings that commitment to the Post and defines the landscape broadly and ambitiously, if he really wants to build a great, enduring journalism organization on a global scale or on a national or even just regionally, it could be an asset.

On the less encouraging side, I take note from his first statement, in which he said it’s all about what readers what. Well, yes, but… That’s the data science and customer preference speaking. And in my experience watching this the last 10 years, it’s very difficult to build a great newsroom when you overemphasize the data science of customer preferences. You already have a newsroom that’s half or two-thirds of its former self and in a state of anxiety now doubled by this ownership transition. You have to be clear about what matters, and that journalism matters. Now, if he retains Marty Baron, who’s a great editor, and commits himself to that sort of thing, that would be great. But I don’t know.

I think we’ve seen so many outside CEOs and successes in other industries come to the newspaper industry with the assumption that with the insights they’ve gained from their other successes will be applicable. Brian Tierney, who bought the Inquirer in Philadelphia. Sam Zell in Chicago. And I shudder to think that if we went back and looked at the comments 24 hours after those announcements how much optimism we would discover—never mind how much hubris the new owners would have expressed. But, look, Jeff Bezos is leagues above those two examples; his intelligence, and his accomplishments, and his character even, I think, in comparison to Zell at least. But is that enough? People really don’t know what they don’t know. The news business is as much art as science. And that’s the part that I wonder about; it’ll be a really interesting experiment.

The other thing that I worry about, just on the face of it, is that he said he has a day job that he loves, that he doesn’t intend to run this hands-on. Well, of course, nobody buys something for $250 million in the heart of the nation’s capital without getting involved, so I take that with a grain of salt. But this really is something that, if he wants to transform it successfully, and to learn about how to synthesize his insights about the digital universe with the traditions of journalistic excellence and aspirations that he’s inherited, he’s going to have to put both of his hands on it, at least for a while. And I don’t know that you can do that as a kind of hobby, at least for a couple or three years. So I worry about that kind of in-between approach. We don’t really have a model of success to rely on, of someone coming from another industry into the newspaper business in these last five or 10 years and using their insights from another industry to successfully solve these problems. Off the top of my head I can’t think of an example.

The reaction to the sale (along with the sale of The Boston Globe and the Koch brothers’ interest in the LA Times) has included a fair amount of suggestion that we are entering another era of the powerful media mogul/businessman, not unlike the Pulitzer-Hearst era. Are people making too much of that?

So far I think the comparisons to Pulitzer and Hearst are very much premature. I mean, Pulitzer and Hearst were committed newspapermen. Pulitzer spent his whole life after he got out of the army as a mercenary in the Civil War as a newspaperman, and a little bit as a politician. And Hearst, too, came East with his father’s fortune at his back, as a man who knew exactly what he wanted to do, which was to dominate the world of newspaper publishing. And the insights that they acquired over their lifetimes were the insights of lifelong editors and publishers, and so that’s not quite where we are here. These buyers have deep pockets, but none of them has spent a lifetime in journalism. Jeff Bezos is 49, and he’s devoted his life to data science and its insights, the insights it offers into retailing and marketing, and now he’s turning to the newspaper industry just as he earlier turned to space tourism. He’s a very bright guy. Maybe if he throws himself at it he’ll solve this equation that devoted publishers like Don have been struggling with—and a lot of other companies by the way, including the Hearst Corporation, are struggling with. Maybe he’ll solve the equation and do everybody a service that way. But to compare him to Pulitzer or Hearst doesn’t seem quite right.

And by the way, last night I was reading, as part of my new job, this essay that Pulitzer wrote that’s sort of a Rosetta Stone of the school, the one where he defends his investment in the school against his critics, and one of the arguments that he takes up is the question of whether aspiring journalists should concern themselves with business models, and he says absolutely not. Journalism is a profession, it’s not a business, he says. And you know, in essence, leave it to those of us who are responsible for how to keep circulation revenue and advertising revenue flowing. But the art, the profession, the sweat, blood, and tears of journalism lies in another sphere, and it’s in the newsroom. And so he at least, as a model for today’s tycoons, had a very specific devotion to journalism as it has on and off been practiced for the last century or so. I don’t know if that’s going to flow out of these purchases. It may be more present actually in the kind of startups like Politico, where you have a kind of a well-resourced, private-sector entrant who wants to be a media player as much as they want the business investment, and then they hire, as Politico has done, two outstanding journalists to run it, and let them have their head, and let them run it with great verve, while also experimenting with new challenges of audience and revenue. Whether that’s what we’ll see unfold in the newsroom of The Washington Post or not, I have no idea. I didn’t see yesterday any clear statement of intention that way.

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